Jeremy Hunt and the secret BSkyB memo to David Cameron

Jeremy Hunt was accused on Thursday night of misleading Parliament after it
emerged that he wrote a private memo to David Cameron supporting a News
Corporation buy-out of BSkyB, a month before he was put in charge of
scrutinising the bid.

Jeremy Hunt ended the note by suggesting that he and David Cameron should have a meeting with Vince Cable and Nick Clegg 'to discuss the policy issues that are thrown up as a result' Photo: Getty/AP

Last month, Mr Hunt told the House of Commons that he “made absolutely no interventions seeking to influence” the decision on whether to refer the bid to regulators when it was the responsibility of Vince Cable, the Business Secretary.

But on Thursday the Leveson Inquiry published a memo dated Nov 19, 2010, sent just weeks before Mr Hunt took over the quasi-judicial role from Dr Cable, in which he warned that News Corp’s James Murdoch was “furious” about the Business Secretary’s handling of the matter.

The note expressed concerns that referring the bid to Ofcom could leave the Government “on the wrong side of media policy” and said it would be “totally wrong” for ministers to “cave in” to News Corp’s opponents.

Senior Labour sources said on Thursday night that it was “absolutely clear” that Mr Hunt had misled Parliament.

Harriet Harman, Labour’s deputy leader, added: “It is clear from today’s evidence that David Cameron gave responsibility to Jeremy Hunt for deciding on the BSkyB bid when he knew only too well that the Culture Secretary was actively supporting the bid.

“The Prime Minister should never have given him the job. It is clear that Jeremy Hunt was not the impartial arbiter he was required to be, and he should already have resigned.”

The lengthy memo was not declared to Sir Gus O’Donnell, the then cabinet secretary, either by Mr Cameron or Mr Hunt at the time of the appointment, it emerged.

Downing Street sources said that the memo would not have changed the cabinet secretary’s decision to back Mr Hunt’s appointment, but this assertion was expected to be challenged by opposition MPs in the coming days.

Mr Cameron admitted that he had received the memo, prompting Labour MPs to demand the recall of Parliament, currently in recess for Whitsun, so that Mr Cameron and Mr Hunt could make statements and be questioned by MPs.

The Leveson Inquiry into media standards also heard that Mr Hunt and his officials exchanged 799 text messages with Frederic Michel, News Corp’s chief lobbyist, during the bid process.

One message from the Culture Secretary read “Merci. Large drink tonight” after the Frenchman congratulated him on a performance in the Commons. Mr Hunt has previously told the Commons that all of his contact with Mr Michel was minuted.

The Culture Secretary’s special adviser, Adam Smith, was given no legal advice on how he should communicate with News Corporation executives, even though he was charged with handling discussions on the quasi-judicial process.

Four days before Mr Hunt wrote the memo to Mr Cameron, he had spoken to James Murdoch on his mobile phone, having been told by lawyers to cancel a proposed meeting with the News Corp executive.

At the time. Mr Cable was still in charge of deciding whether News Corp’s bid to buy the 61 per cent of BSkyB shares it did not already own should be referred to regulators.

A month later, Mr Hunt took over the brief from Mr Cable, who was replaced after telling undercover reporters from The Daily Telegraph that he had declared “war” on Rupert Murdoch.

The memo read: “James Murdoch is pretty furious at Vince’s referral [of the bid] to Ofcom [the broadcasting watchdog]. He doesn’t think he will get a fair hearing from Ofcom. I am privately concerned about this because News Corp are very litigious and we could end up in the wrong place in terms of media policy.

“Essentially what James Murdoch wants to do is to repeat what his father did with the [Sun] move to Wapping and create the world’s first multi-platform media operator, available from paper to web to TV to iPhone to iPad. Isn’t this what all media companies have to do ultimately? And if so, we must be very careful that any attempt to block it is done on genuine plurality grounds and not as a result of lobbying by competitors. The UK has the chance to lead the way … but if we block it our media sector will suffer for years … I think it would be totally wrong to cave in to the Mark Thompson/Channel 4/Guardian line that this represents a substantial change of control given that we all know Sky is controlled by News Corp now anyway.”

The Daily Telegraph was part of the alliance opposed to the takeover.

Mr Hunt ended the note by suggesting that he and Mr Cameron should have a meeting with Mr Cable and Nick Clegg “to discuss the policy issues that are thrown up as a result”.

The memo could be viewed as contradicting comments that Mr Hunt made in the Commons last month, when he said: “I made absolutely no interventions seeking to influence a quasi-judicial decision that was at that time the responsibility of the Secretary of State for Business.”

The memo was sent to Mr Smith, the former special adviser to Mr Hunt who resigned last month over his own role in the handling of BSkyB, to check it before it was sent to Downing Street. Mr Smith told the Leveson Inquiry that he did not believe the meeting went ahead. It is understood that the Prime Minister did not reply to the memo.

Mr Hunt had a statutory obligation to remain impartial as he considered whether to refer the BSkyB bid to regulators and the Competition Commission over concerns that it could reduce the “plurality” or diversity of media in the UK. A source close to Mr Hunt said the memo did not provide any reason to think the Culture Secretary could not carry out the quasi-judicial role. News Corporation dropped the takeover bid in July 2011 following the phone hacking scandal.

“Jeremy is clear in the memo, as he was throughout the bid process, that it should only go ahead if it addressed the plurality concerns,” said the source.